Rivalry for low-end jobs likely to grow

In proposing an expansive guest-worker program, President George Bush endorsed a view that some economists have been promoting for years: undocumented immigrants have long become an essential, perhaps inextricable, part of the US labour force.

And by conveying legal status on millions of people already toiling in the background of the US economy, analysts said, Bush's plan could ease labour shortages, improve working conditions and perhaps shore up wages paid to previously illegal immigrants.

"They're here. They're working," said Jared Bernstein, senior economist at the liberal-leaning Economic Policy Institute in Washington. "Let's block the low road and get them on the high road. Let's obey the labour laws and play by the rules."

The longer-term impact of Bush's proposal could cut two ways. If the plan resulted in a substantial increase of foreign workers flowing across US borders it could create more competition for low-end jobs, put downward pressure on wages and potentially displace some native-born workers. At the same time it could reduce the price of many goods and services.

"There will be winners and losers," said James Smith, an economist. "The losers will be low-skilled domestic workers. The winners will be the rest of us."

Although the proposal drew protests from unions and immigration critics, several economists and policy analysts said it reflected the fact that undocumented immigrants were tightly woven into the fabric of the US work force.

"It's a recognition of the important role that immigrants play in the economy," said John Gay, co-chairman of the Essential Worker Immigration Coalition.

Although US employers have shed 2.3 million jobs since Bush took office, supporters of his plan said jobs still went begging in such sectors as agriculture, lodging, restaurants, health and nursing and construction.

Supporters of Bush's proposal say the addition of immigrants to the US labour pool produces a net economic benefit for the nation by reducing the cost of goods and services.

But they acknowledge that the savings are attributable to the lower wages that employers are able to pay because of competition among jobseekers.

"Employers want everything," said Thea Lee, chief economist with the union federation the AFL-CIO. "They want access to cheap labour. They want to pay much lower wages. Our argument is that some of these wages need to rise to make the jobs more attractive."